Cyprus will be able to maintain its corporate tax of 10%, even if the country asks for the assistance of ESFS or the ESM for the recapitalization of its banking sector, Finance Minister Vassos Shiarly said today.
Speaking during a dinner, organized in Nicosia by the Cyprus-Russian Business Association, Shialry referred to the example of Ireland, which was able to maintain the country’s favorable corporate tax when the government received an 85 bln euros bailout from its European counterparts.
The Minister said that similar fears may exist in Cyprus, but noted his confidence that “the corporate tax will not be touched upon”, even if the country takes refuge to the EFSF to assist the recapitalization of one of its banks.
“We do everything we can so as to ensure that this valuable asset of our financial sector will be maintained”, Shiarly noted.
Addressing the dinner, the Minister said that the Cyprus economy has proven its capability of successfully confronting challenges, as shown by its economic performance in the current very negative economic environment.
He further noted that one of the main goals of the government is to maintain the advantages of the Cyprus economy and further improve its competitiveness.
Speaking on the negative consequences of the financial crisis, Shiarly said the government had adopted a comprehensive fiscal consolidation package, with a view to bring public finances on a sustainable path.
He added that a set of new measures, aiming at strengthening economic growth and fostering employment are already under implementation.
Our aim is for Cyprus to remain an attractive investment destination and a reliable international business center, he said.
He also spoke about the recent discoveries of hydrocarbon reserves in the island’s Exclusive Economic Zone, noting the investment interest displayed by large companies from Canada, China and Russia.
The initial data that emerged from the exploratory drilling conducted by Houston-based “Noble Energy” in Cyprus Exclusive Economic Zone block 12, indicate the existence of a natural gas reservoir ranging from 5 to 8 trillion cubic feet (tcf) with a gross mean of 7 tcf.
A second licensing round for companies interested to receive concessions for exploratory drillings in Cyprus’ EEZ was concluded last May, resulting to bids by fifteen companies and joint ventures. Bids are being currently evaluated by the government.
The Minister called on foreign investors to exploit Cyprus’ substantial comparative advantages, adding that the Cyprus-Russian Business Association may play a vital role in this direction.
President of the Cyprus-Russia Association Evgenios Evgeniou said during his address that Cyprus is fortunate to have close business links with Russia, which proves to be useful under current difficult economic conditions.
He added that the Association in cooperation with Cyprus Chamber of Commerce and Industry (CCCI ) will explore and aims to invest in regions of Russia in 2012.
President of CCCI Phidias Pelidis also addressed the event.
